In a dynamic marketplace, existing customers as well as competitors and new players could threaten Vopak’s market position. In recent years, we have faced increasing competition from existing providers in the storage industry, but various newcomers, in particular private-equity and infrastructure funds, have also entered our market. In response to this development, Vopak is giving priority to rapid growth, especially in logistically strategic locations; we are strengthening our business development functions. We ensure that we are closely connected to our business, enabling swift, efficient and effective decision making and project execution by people that truly understand our business, thereby reducing waste in terms of costs and time. We are also aiming to achieve higher customer satisfaction by providing high-quality service and highly efficient operational processes. In addition, we strive for a balanced duration of our sales contracts, in which we have been quite successful. We are working on effective cost management and providing high service levels in order to offer competitive prices. Maintaining and strengthening our market position depends on an optimal use of our worldwide network.
Sector developments provide a mixed picture and for this reason we continue to focus on product streams. We have a sound insight into product streams and the forecasted development of these streams. This insight supports our terminal strategies, the locations where we want to have terminals and the layout of such terminals. Currently, the picture in most sectors is clear, like in the oil storage market, which has continued to be robust. The chemical sector remains at a level comparable to that of 2009. The overall occupancy rate was slightly down at 93% in 2010, which was primarily due to a lagging demand for biofuel storage and new capacity coming on stream for chemical storage. The current uncertainty in the product stream of biofuels does impact on our terminals in Europe and on the East Coast of the United States, as these streams remain dependent on governmental support (subsidies) or mandatory regulations. This uncertainty shows the predictable immaturity of these streams, which is likely to continue in 2011 and beyond. However, the underlying need for sustainable (certified) biofuels in Europe and North America will eventually lead to opportunities for further growth in this area, though possibly with different players and different products from different origins. Potentially we will have to find alternative solutions for some of our biofuel tanks in certain locations, but as a tank terminal company with global operations, Vopak is excellently positioned to capitalize on any resulting new opportunities.